Wharton Tackles Why The Housing Market Sucks

Not to end the week on a downer, but I ran across an interesting study on the current state of the national housing market (there are plenty of analyses to go around, I know).

The Wharton University School of the University of Pennsylvania tackles the housing crisis in a special report, The Subprime Crisis, How Wall Street Alchemists, Ambitious Lender, Overreaching Consumers and Enabling Lawmakers Pushed the Economy to the Brink of Recession, and How to Avoid a Repeat.

Here’s a summary:
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Youtube link to Wharton Summary of the Subprime Crisis

With articles, interactive features, podcasts, opinions, etc., it’s a comprehensive view the of housing mess we’re in nationally.

Their conclusion? Bottom line, it comes down to greed. No surprise there. It’s part of the human condition.

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June 20, 2008 · Filed Under Mortgages, National News

Comments

6 Responses to “Wharton Tackles Why The Housing Market Sucks”

  1. Steve on June 22nd, 2008 8:08 pm

    FYI: Wharton is not a university, but the renowned undergraduate and graduate business school of the University of Pennsylvania.

  2. Ron Ares on June 22nd, 2008 8:20 pm

    Corrected. I knew it didn’t sound right but didn’t circle back to get it straight. Thanks for the catch.

  3. Portland Oregon Real Estate Agent Blog » Housing News from Harvard U on June 23rd, 2008 4:01 pm

    [...] digesting Wharton’s subprime research, housing wonks will want to grab a copy of Harvard University’s report, The State of the [...]

  4. bearlee on June 23rd, 2008 4:45 pm

    Ron, what’s your take on the final sales price vs. listing price for the Lake O homes sold last week (property blotter). Some buyers got some significantly large discounts. I know it’s difficult to generalize and I know you don’t know each one’s situation but wanna through some educated ideas out there? Thanks, Leigh

  5. bearlee on June 23rd, 2008 7:38 pm

    throw! not through! how about an educated question from bearlee!? hahaha I shall proof read next time…

  6. Ron Ares on June 24th, 2008 9:27 am

    Bearlee,

    One of the properties was on the historic register, which complicates how the property can be developed, remodeled, etc. I don’t have any specifics about the other highly discounted properties.

    My guesses:

    * Urgent need to sell
    * Poor pricing methodology from the outset
    * Defects or other issues found during the inspection
    * Agressive buyer activity
    * Property handled by relocation company who didn’t want to hold it long.

    All speculation….

    Most showed ~10% price drops, which isn’t far off the 92% or so of the average list to sale price across the market as a whole. In our analysis, we are going back beyond the current listing, and including any previous listings since the previous sale.

    In our West Linn analysis ( http://www.move2westlinn.com ), we are now seeing some banks settling short sales at significantly reduced prices. We’ll see if this is a blip, a trend, or a wave.

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